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Maine First-Time Home Buyer Programs of 2019

July 11, 2019
Finding the Right Mortgage, Mortgages
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Buying a first home is a steep challenge, but a variety of home loan programs can give you a leg up. The Maine State Housing Authority, or MaineHousing, offers programs to help qualified first-time home buyers, mobile home owners and veterans get a mortgage.

National home loan programs also help make homeownership more accessible by featuring low-down-payment or low-credit-score requirements.

Investigate these mortgage options to get started on buying a first home in Maine.

National first-time home buyer programs

With their no- or low-down-payment requirements, these nationally available mortgages meet the needs of many first-time home buyers.

Conventional mortgage

National program

Best for

Low down payment

Limited mortgage insurance premiums

What you need to know

First-time home buyers can get a conventional home loan with as little as 3% down if the mortgage meets requirements set by Fannie Mae and Freddie Mac. And if you put at least 20% down, you won’t have to pay mortgage insurance. Most lenders require a minimum credit score of 620 to qualify for a

 

VA loans

National program

Best for

Military

Low down payment

What you need to know

The U.S. Department of Veterans Affairs helps service members, veterans and surviving spouses buy homes. VA loans are especially generous, providing competitive interest rates, often requiring no down payment or mortgage insurance. Although there is no official minimum credit score, most

 

FHA loans

National program

Best for

Low credit score

Low down payment

What you need to know

This is the go-to program for many first-time home buyers with lower credit scores. The Federal Housing Administration allows down payments as low as 3.5% for those with credit scores of 580 or higher. The FHA will insure loans for borrowers with scores as low as 500 but requires a 10% down payment

 

USDA loans

National program

Best for

Low down payment

Rural

What you need to know

A USDA home loan is a zero-down-payment mortgage for eligible rural and suburban home buyers. USDA loans are issued by the U.S. Department of Agriculture through the USDA Rural Development Guaranteed Housing Loan Program. There are income limitations, which vary by region. Applicants with credit

MaineHousing highlights and eligibility requirements

You’re considered a first-time home buyer in Maine and may be eligible for a MaineHousing program if you haven’t owned a home in the last three years. Veterans and retired or active-duty military members are also eligible, as long as any home they currently own is sold by closing. Current or former owners of unattached mobile homes on leased land can also apply.

» MORE: Tips for first-time home buyers

Highlights

  • Offers mortgages with below-market, fixed interest rates and no- or low-down-payment options.
  • Down payment and closing cost assistance available.
  • Condos, and some permanently attached mobile homes, are eligible.
  • Provides mortgage payment protection in case of unemployment.
  • Offers a free interest rate lock of 90 days for existing properties and 210 days for new homes, including modular and mobile homes.
  • Qualified veterans, active-duty and retired military can qualify for an interest rate discount.
  • Mortgage and grant program available to replace old mobile homes with new, energy-efficient manufactured homes.

Eligibility

  • Meet income and purchase price limits; most Maine households and Maine properties are eligible.
  • Complete home buyer education class to receive down payment or closing cost assistance.
  • Have a minimum credit score of 640.
  • Property must be three acres or less for existing homes and one acre or less for new homes, if the land value exceeds 30% of the overall appraised value.
  • New and existing single-family homes, owner-occupied two- to four-unit apartment buildings, condominiums and permanently attached mobile homes are eligible.
  • Mobile homes must be 20 years old or less and may be on owned or leased land for the First Home Loan program.

» MORE: Compare the best mortgage lenders for first-time home buyers

MaineHousing first-time home buyer programs

First Home Loan

State program

Learn more

at MaineHousing

Best for

Low down payment

Low mortgage rates

What you need to know

This program offers mortgages with below-market, fixed interest rates and no- and low-down-payment options for first-time home buyers. You can pay discount points to lower the interest rate further. Zero-point and two-point loan options are available. Eligible borrowers can combine the loan with

 

Salute ME

State program

Learn more

at MaineHousing

Best for

Military

What you need to know

This program offers a 0.25% discount on the interest rate for a First Home Loan to qualified veterans and retired and active-duty military who are first-time home buyers. The program can be combined with the other options available with First Home Loans, including down payment and closing cost

 

Salute Home Again

State program

Learn more

at MaineHousing

Best for

Military

What you need to know

Veterans and active-duty military don’t have to be first-time home buyers to qualify. The program offers a 0.25% discount on the interest rate for a First Home Loan. Down payment and closing cost assistance and other First Home Loan options are available.

 

Advantage

State program

Learn more

at Maine Housing

Best for

Down payment assistance

Closing cost assistance

What you need to know

The program offers up to $3,500 for down payment and closing cost assistance to borrowers using a MaineHousing First Home, Salute ME or Mobile Home Self-Insured Home Mortgage. The program is available only with the zero-discount-point mortgage option. The borrower must contribute at least 1% of the

 

Mobile Home Self-Insured Option

State program

Learn more

at MaineHousing

Best for

Manufactured homes

No mortgage insurance

What you need to know

The program insures mortgage loans for mobile homes when the loan-to-value is more than 80% and less than or equal to 95%. Borrowers pay a higher interest rate but don’t have to pay for mortgage insurance. The option can be combined with the Advantage program for down payment and closing cost

 

Pre-1976 Mobile Home Replacement Initiative

State program

Learn more

at MaineHousing

Best for

Manufactured homes

Energy-efficient improvements

What you need to know

The program combines a MaineHousing mortgage with a $30,000 MaineHousing grant to replace a mobile home built before 1976 with an Energy Star-certified manufactured home. The grant, which helps pay the cost of removing the old mobile home, is in the form of a deferred, forgivable note and requires

Summary: 2019 Maine first-time home buyer programs

  • First Home Loan with below-market interest rates and low-down-payment options.
  • Salute ME program with interest rate discount on First Home Loans for veterans.
  • Salute Home Again with interest rate discount on First Home Loans for veterans who are not first-time buyers.
  • Advantage program for assistance with down payment and closing costs on First Home Loans.
  • Mobile Home Self-Insured Option, a replacement for mortgage insurance for  mobile home buyers.
  • Pre-1976 Mobile Home Replacement Initiative, a mortgage and grant program for owners of older mobile homes.

MaineHousing offers its home buyer programs through a network of approved lenders. Before you start shopping for a home, contact an approved lender to apply. The lender will explain the eligibility requirements and help you choose the right home loan and assistance program.

You can learn more about the programs and the homebuying process at MaineHousing.

» MORE: See the best mortgage lenders for first-time home buyers

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